Under the provisions of Massachusetts General Laws, Chapters fifty-eight to sixty-five C, the Board of Assessors fall under the jurisdiction of the Commissioner of Revenue who may revise rules, regulations, and guidelines, as deemed necessary to establish minimum standards of assessment performance.
In Massachusetts, the property tax is an ad valorem (based on value) tax. In the late 1970s, the Massachusetts Supreme Court in the Sudbury Decision ruled that property values would be based upon 100% full fair cash market value. Full and fair cash value is the amount a willing buyer would pay a willing seller under no special circumstances and given a reasonable exposure to the market. Assessors must use accepted Massachusetts’ appraisal techniques to value property.
In order to determine market value, a sales verification process is started by members of the assessing staff. Letters are sent to buyers and sellers to attest to the Arms Length Nature of the sale to determine if there were special circumstances involved and to determine the condition of the property on the date of sale. Property measurements and current conditions of property are then updated on all sales. A complete statistical analysis is performed and must meet Department of Revenue standards to satisfy the Commissioners Standards of Performance in order to meet annual and triennial certifications before tax bills may be mailed.
The property tax levy is the revenue a community can raise through real and personal property taxes. Under Proposition 2 ½, there are limits on the amount of the levy raised by a city or town and on how much the levy can be increased from year to year.
Assessors annually classify all real property into one of four real property classes either residential, commercial, industrial, or open space. The City may then allocate the tax levy among the classes of real property within prescribed statutory limits. The tax rate applicable to commercial, industrial and personal property may be higher than applied to residential properties. Approximately 100 communities in Massachusetts opt each year to shift the tax burden from residential to commercial, industrial, and personal property classes rather than to apply the same rate to all classes of property.